Manchester Monitor May 2014
Further boost for visitor economy
Jobseeker numbers fall again Growing sales in GM firms Airport passenger numbers still growing House prices on the rise www.neweconomymanchester.com research@neweconomymanchester.com
Monitor Focus Further boost for visitor economy The latest data continue to emphasise the strength of the visitor economy in Greater Manchester (GM), with Manchester Airport reporting further growth in passenger numbers and announcing new routes to destinations such as Hong Kong from December onwards. This will make Manchester the only airport outside of London offering a nonstop service to China. Prior to this, from September Ryanair will begin flying to Barcelona, Lisbon, Fuerteventura, and Gran Canaria – carrying an estimated 200,000 additional people from Manchester. Manchester Airport plays an important role in acting as an international gateway to GM and new figures released by the Office for National Statistics emphasise the popularity of GM with visitors from abroad. With nearly one million visits in 2013, Manchester was the most popular city in England outside of London for an overnight stay by overseas residents. This was ahead of the likes of Birmingham and Liverpool, and Manchester is also closing the gap on Edinburgh which is in second place. Hotel occupancy data also reveal record levels of occupancy were achieved in Manchester city centre for March at almost 81%, well above the March average between 2000 and 2013 of 74%. Occupancy was also stronger than average at 78% across GM. Levels climbed to 98% on three separate dates in the city centre in March, including for the Manchester derby and Manchester United versus Liverpool in the Premier League. Plans to open a new 86-room boutique hotel in the historic Corn Exchange in Central Manchester have also emerged, which will further increase capacity in the city centre. Looking at the wider economy, the latest unemployment figures show just over 61,000 people were claiming Jobseeker’s Allowance (JSA) in GM in March – a decrease of 2,900 (2.9%) from the February figure of 64,300. This represents a return to the longer-term trend in unemployment, following the increase in JSA claimants in
1 | Manchester Monitor – May 2014
January due to the effect of seasonal Christmas jobs. Overall, the number of JSA claimants in GM is 28.2% less (24,050) than 12 months ago. The positive outlook is also evident for youth unemployment (JSA claimants aged 16– 24), with the number of youth JSA claimants in GM now 36.3% (8,400) lower than this time last year. The improving labour market statistics coincide with continued growth in the UK economy as a whole. Preliminary estimates by the Office for National Statistics (ONS) for the first quarter of 2014 show that UK GDP grew by 0.8%. This was the fastest rate of growth in more than three years, with production (which includes manufacturing), construction, services and agriculture all registering increased activity. Sounding a note of caution however, GDP still remains 2.5% lower than it was at the start of the recession in 2008, however the National Institute of Economic and Social Research (NIESR) recently said that it expects GDP to regain its first quarter 2008 level by the middle of 2014. Separately, NIESR has upgraded its growth forecast for the UK economy to 2.9% in 2014, up from an earlier estimate of 2.5%. The Quarterly Economic Survey (QES) for Q1 2014 by the GM Chamber of Commerce indicates this positivity is also being felt by GM’s businesses, as UK sales and orders across both services and manufacturing are showing signs of growth. Order books in each sector continue to increase and the outlook for companies in the conurbation is far more positive than it was from 2009-2012 when the economy was struggling to recover from the downturn. Housing market data show that prices are slowly starting to rise in the conurbation, with an average property now costing just under £105,000 in March 2014 according to Land Registry data – an annual rise of 3.5% (£3,500). Prices do remain more affordable in GM than nationally, where the average house now costs £169,000, with only Trafford (£184,000) above this price.
Monitor Dashboard Jobseeker’s Allowance (JSA) claimants
Airport Passengers
28.2%
2.6%
since last year
since February 2013
UK Sales in GM Firms
Hotel Occupancy
7pts
3%pts
The balance of GM manufacturing sector companies reporting improving UK sales figures is up on Q1 2014 to +34%
average occupancy rate in GM was 78%, up from 75% on the previous 12 months
House Prices
3.5% since March 2013
Manchester Monitor – May 2014 | 2
People Monitor Long-term unemployment fall continues The latest figures on the number of people claiming Jobseeker’s Allowance indicate that the longer term trend of falling unemployment has returned to GM. This follows the seasonal increase in JSA claimants recorded in January. Just over 61,400 people were claiming Jobseeker’s Allowance (JSA) in GM in March – a decrease of 2,900 (4.5%) when compared with the figure for February 2014 of 64,300. Overall, the number of JSA claimants in GM is 24,000 less (28.2%) than 12 months ago. JSA Claimants As a proportion of the resident working-age population, 3.5% of people in Greater Manchester were claiming JSA in March, which remains higher than the North West (3.2%) and Great Britain (2.9%) rates. The number of male JSA claimants in GM decreased on a monthly basis by 5.0% (2,100) to 40,100, while the number of female claimants decreased 3.6% (800) to 21,300. Annual JSA numbers for males and females are also falling. Male JSA claimants in GM fell by 17,500 (30.4%) year-on-year, the number of female claimants fell by 23.5% – equating to 6,600 fewer female claimants in GM. The positive outlook is also evident for youth unemployment (JSA claimants aged 16–24) in GM, which decreased on a monthly basis between February and March by just under 900 to 14,800. On an annual basis, the number of youth JSA claimants is now 36.3% (8,400) lower than this time last year in GM. Long-term claimants (those claiming for 6 months or longer) in GM declined to 27,700 in March, down by 1.6% (450) on the February figure. On an annual basis the number of longterm claimants is now 26.9% (10,200) lower in GM, a faster improvement than in the North West (26.6%) and Great Britain (25.1%) as a whole. The continuing fall in claimant numbers shows that the labour market is in a stronger position than 12 months ago. The latest estimates for December 2013 to February 2014 from ONS confirm that UK unemployment is continuing to fall, as does the number of economically inactive people aged 16–64.
In another positive sign for the labour market, ONS data show that average weekly pay including bonuses grew by 1.7% to £479 in the three months to the end of February, up from the 1.1% increase in the three months to the end of December. The increase in wages is now slightly above inflation, with the most recent Consumer Price Index (CPI) standing at 1.6%. This is the first time since 2010 that average pay increases have either matched or surpassed the annual percentage increase in CPI. Wages have not kept pace with price rises over a sustained period since 2008. Vacancies Data Labour Insight shows that there were 16,300 job openings in GM in March 2014, which is a 12.3% decrease (2,300) on the same month last year. While regular analysis of vacancies data can provide an interesting indicator on current labour market opportunities, it should be noted that vacancies data tends to fluctuate more than employment data. More detailed analysis shows that the highest proportion of vacancies in March 2014 were in professional occupations (33.0%, or 5,300), followed by associate professional & technical roles (22.0%, or 3,600). Nearly two-thirds of vacancies in GM in March were situated in Manchester (64.8% or 10,500), followed by Stockport (7.6% or 1,200) and Bolton (5.2% or 850).
Jobseeker’s Allowance - Annual Change
Total Jobseeker’s Allowance Claimants in January 2014
61,406 Decreased by 28.2% year-on-year
Vacancies - Annual Change Women
Men
Youth
$23.5% $30.4% $36.3% $26.9%
$12.3% 1
Source: Labour/insight (Burning Glass Technologies)
3 | Manchester Monitor – May 2014
Long-term
Business Monitor UK sales figures in GM firms
60
UK Services sector sales Q1 2014: +33 %
40
Balance of firms
20
0 UK manufacturing sector sales Q1 2014: +34%
-20
-40
Manufacturing
Q1-14
Q1-13
Q1-12
Q1-11
Q1-10
Q1-09
-60
Services
GM firms report growing sales The Q1 2014 GM Chamber of Commerce Quarterly Economic Survey (QES) collates the opinions of businesses across GM in the service and manufacturing sectors. The latest results show the positive outlook seen at the end of 2013 is continuing. The first quarter of 2014 suggests growth is up overall, suggesting GM firms remain on course for a positive 2014. Manufacturing The balance of GM manufacturing companies reporting improving UK sales figures in Q1 2014 was 34% (the difference between positive and negative responses) and it is approaching the pre-recession peak of 39%. In addition to sales, the balance for UK manufacturing firms on orders increased by six percentage points to 27%, only two points behind the pre-recession peak of 29%. Export figures for the manufacturing sector declined in Q1 2014 compared with the final quarter of 2013. The balance for export orders was 19% (compared to 25% in Q4 2013), while for deliveries it was 16% (26% in Q4 2013). This shows that some challenges remain in the international markets despite the more encouraging outlook in the UK.
Services The balance for export orders in the service sector was 25% in Q1 2014, which is the highest level since the survey began over ten years ago. Export deliveries for the sector fell by five percentage points between Q4 2013 and Q1 2014 to 25%, however. The balance for service sector UK deliveries was 33% in Q1 2014, down from 36% in Q4 2013. The balance for service sector UK orders grew by two points in Q1 2014 to reach 30%. It is important to note that the final quarter of 2013 saw a major increase in both deliveries and orders, and the first quarter of the year still shows a positive outlook for the sector – especially when compared with results from 2009, 2010, 2011 and 2012 editions of the QES.
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Place Monitor Visitor economy performing well The latest monthly airport data from the Civil Aviation Authority shows that passenger numbers continue to grow at Manchester Airport with new routes expected to provide a further boost over the coming months. Hotel occupancy also continues to rise in GM and the city centre, with the highest ever level of occupancy being recorded for the month of March. Airport Passenger Numbers The number of passengers continues to grow at Manchester Airport. It handled 1.2 million passengers in February 2014 according to data from the Civil Aviation Authority, up by 2.6% (31,300) on the corresponding month in 2013. This was higher than the annual increase at Heathrow (1.0%), although it was lower than the year-on-year rises seen at Stansted (6.9%), Gatwick (7.7%) and Birmingham (8.0%). This shows that the airport is well positioned to exceed the 20.8 million passenger numbers achieved in 2013. To cope with increased demand, the Airport has extended the opening hours of its second runway by 3 hours. Further growth in passenger numbers is expected over the coming months as airlines introduce new routes. This includes new flights to long haul destinations, with Jet2 commencing flights to New York from October 2014 and a service by Flynas to Jeddah, Saudi Arabia. From December there will be direct flights to Hong Kong operated by Cathay Pacific four times a week. This will make Manchester the only airport outside of London offering a nonstop service to China. New short haul flights have also been announced, and from September Ryanair will begin flying to Barcelona, Fuerteventura, Gran Canaria and Lisbon – carrying an estimated 200,000 additional people. Manchester Airport plays an important role in acting as an international gateway to GM and new figures released by the Office for National Statistics emphasise the popularity of GM with visitors from abroad. With nearly one million visits in 2013, Manchester was the most popular city in England outside of London for an overnight stay by overseas residents. This was ahead of the likes of Birmingham and Liverpool. Hotel occupancy (city centre)
(+4.0% pts)
Hotel Occupancy Hotel occupancy rates in Manchester city centre were recorded at 80.5% in March 2014, up four percentage points from March 2013. This was the highest March figure ever recorded, with the average from 2000-2013 standing at 74%. For GM as a whole, occupancy levels were also stronger than average at 78%. This represents a three percentage point rise compared to March 2013. The average weekend occupancy rate in the city centre was 87% in March 2014, up one percentage point from the March 2013 figure of 86%. The weekday average occupancy in the city centre was 78%, up five percentage points since March 2013. Key dates for hotel occupancy in the city centre during March were: • 19 March – occupancy of 98% was achieved, boosted by Manchester United playing Olympiakos in the European Champions League, Manchester Central hosting the National Health IT Conference, as well as the Northern Restaurant and Bar event and the Palace Theatre hosting Evita. • 25 March – 98% occupancy was recorded, with Old Trafford playing host to the Manchester derby in the Premier League. • 15 March – 98% occupancy was recorded, with Miranda Hart’s comedy performance at the Manchester Phones 4u Arena, the BMX National Series at the National Cycling Centre, and the northern edition of the National Wedding Show at Manchester Central, followed by Manchester United versus Liverpool the following day at Old Trafford. Airport passenger numbers
(+2.6%)
80.5%
1,227,546
Hotel occupancy (GM)
Flights
(+2.5% pts)
77.7%
(-3.4%)
10,081 % represents year-on-year change
IMPORTANT NOTE: The source of the hotel occupancy data referenced in this newsletter is STR Global Ltd. Republication or other reuse of this data without the express written permission of STR Global is strictly prohibited.
5 | Manchester Monitor – May 2014
Housing Monitor Average house prices in GM, March 2014
Trafford average = £183,809
£200,000
England & Wales average = £169,124 £160,000
Oldham average = £83,806
GM average = £104,940
£120,000
£80,000
£40,000
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rd fo Sa l
an W ig
Bo lt o n
Ta m es id e
ch es
te r
M M an
G
Bu ry
ck p St o
Tr af fo
rd
or t
£-
House prices on the rise The latest data from the Land Registry show that the average house in GM cost £104,940 in March 2014, an increase of 3.5% (£3,549) from this time last year, still below the rise seen in England & Wales as a whole of 5.6% (£8,942), reaching £169,124. House Prices House prices in GM continued to grow slightly with a monthon-month increase of 0.2% (£152) in March 2014 to £104,940. The Land Registry data show that house prices in the North West grew slower than those in GM on both month-on-month and annual terms. Prices in the North West decreased on a monthly basis by 1.8% (£2,039), although they grew moderately year-on-year by 2.3% (£2,474). In contrast to the trend in GM, property prices in England & Wales decreased 0.4% month-on-month (£600) in March 2014, to reach £169,124. At a GM local authority level, eight districts saw house prices rise between March 2013 and March 2014: Oldham (11.3%, £8,502), Bury (7.4%, £7,553), Bolton (6.1%, £5,381), Stockport (4.9%, 6,809), Manchester (2.2%, £2,062), Wigan (2.2%, £2,018), Trafford (1.8%, £3,328), and Salford (1.4%, £1,226). Only two districts saw declines, Rochdale (1.5%, £1,328) and Tameside (1.2%, £1,090).
While prices are rising in the majority of GM districts, the cost of properties still varies considerably across the conurbation – from just under £184,000 in Trafford to £84,000 in Oldham. House sales Land Registry house sales data reveal that there were 2,357 properties sold in GM in January 2014, a monthly decrease of 18.2% (523). This mirrors the number of sales in the North West which decreased by 18.0% (1,471), as well as the national figures which fell by 18.9% (14,720). January is traditionally a quieter time for the housing market, so the monthly decline in sales is not surprising. Year-on-year however, house sales in GM have risen by 43.9% (719). This was slightly lower than trends across the North West and nationally, where house sales rose by 45.6% (2,103) and 45.5% (14,720) respectively between January 2013 and 2014.
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